Supervised Credit, Government Strategies and Green Development: Evidence from China

Bingbing Zhang

zhang7662022@163.com
Agricultural Development Bank of China, Nan‘an Sub-Branch, 362300, Nan‘an, China (China)

Abstract

This study examines the relationship between supervised credit (SC), government strategies, and green development (GD) utilizing the instrumental variable two-stage least squares (IV-2SLS) and spatial econometric model and panel data from 30 provinces and cities in China from 2006 to 2020. The study reached the following main results. First, untrustworthy punishment and trustworthy incentives promote the environmental protection through optimal allocation of supervised resources, which can be positively regulated by the government transformation. Second, beggar-thy-neighbor and free rider can be found in government environmental SC. Strengthening punishment in neighboring regions will have a negative effect on the local GD, whereas increasing incentives will have the opposite effect. Third, strategic interactions among various governmental sections have varying effects on GD. The eastern regions implement difference-based promotion for trustworthy incentives and ineffective imitation for untrustworthy punishment. The central and western regions, on the other hand, use ineffective imitation for trustworthy incentives and inhibiting imitation for untrustworthy punishment, the eastern regions implement ineffective imitation and the central and western regions execute inhibiting imitation. Finally, when R&D investment exceeds a certain threshold, but the industrial structure is lower, the untrustworthy punishment can play its promoting role; otherwise, the trustworthy incentives will turn over. The study findings reveal the unique mechanism of SC and provides new impetus regional policymakers to promote sustainable GD.


Keywords:

supervised credit, untrustworthy punishment, trustworthy incentives, green development

AIZAWA M., YANG C., 2010, Green Credit, Green Stimulus, Green Revolution? China’s Mobilization of Banks for Environmental Cleanup, J. Environ. Dev. 19: 119-144.
DOI: https://doi.org/10.1177/1070496510371192   Google Scholar

CAO X., KANNAIAH D., YE L., KHAN J., SHABBIR M. S., BILAL K., TABASH M. I., 2022, Does sustainable environmental agenda matter in the era of globalization? The relationship among financial development, energy consump-tion, and sustainable environmental-economic growth, Environmental Science and Pollution Research: 1-11.
DOI: https://doi.org/10.1007/s11356-022-19198-8   Google Scholar

CAO G. et al., 2019, The influence of official replacement on economic growth and its mechanism--empirical evidence from prefecture-level administrative regions, China Journal of Economics 6(04): 102-126.
  Google Scholar

CHEN S.Y., CHEN D.K., 2018, Smog pollution, government governance, and high-quality economic development, Eco-nomic Research Journal 53(02): 20-34.
  Google Scholar

CUI M., 2021, Tripartite evolutionary game of environmental credit supervision under the background of collaborative governance, System Engineering Theory and Practice 41(03): 713-726.
  Google Scholar

DENG H. H., YANG L. X., 2019, Haze governance, local competition and industrial green transformation, China Ind. Econ 10 118-136.
  Google Scholar

DING J., 2019, Green credit policy, credit resource allocation, and corporate strategic response, Economic Review (04): 62-75.
  Google Scholar

DONG Z.Q., 2012, Institutional soft environment and economic development – empirical research on the business envi-ronment of 30 major cities, Management World 2012(04): 9-20.
  Google Scholar

DONG Z. Q., WANG H., 2021, Effectiveness Test of Market-based Environmental Regulation Policy – Empirical Evi-dence from the Perspective of Carbon Emissions Trading Policy, Statistical Research 38(10): 48-61.
  Google Scholar

FENG X.Y. et al., 2020, Government transformation, credit governance and industrial green development, Technology Economics 05: 73-84.
  Google Scholar

KHAN J., LI Y., GIRARDIN E., 2022, Is a clash coming when trade and climate meet at the border? The impact of the EU's carbon border adjustment on China's belt and road initiative, Structural Change and Economic Dynamics 63: 112-124.
DOI: https://doi.org/10.1016/j.strueco.2022.09.012   Google Scholar

MA Z.G. et al., 2022, Evaluation of green and high-quality development of national independent innovation demonstration zones, China Population, Resources and Environment 32(02): 118-127.
  Google Scholar

SHEN H.L., JIN D., 2019, Heterogeneous environmental regulation, industrial enterprise R&D and employment skills structure – an empirical study based on spatial panel Durbin model, Soft Science 33(08): 39-43+53.
  Google Scholar

QIU Z.L., WANG Y.H., 2018, The influence of environmental regulation on industrial eco-efficiency under the constraints of administrative monopoly – test based on dynamic space Doberman model and threshold effect, Industrial Economics Research, 2018(05): 114-126.
  Google Scholar

WANG X., WANG Y., 2021, Green credit policy enhances green innovation research, Management World 37(06): 173-188+11.
  Google Scholar

WANG P., SHUFENG G., 2021, Formal environmental regulation, human capital and green total factor productivity, Macroeconomics (05): 155-169.
  Google Scholar

WANG K. H., ZHAO Y. X., JIANG C. F., LI Z. Z., 2022, Does green finance inspire sustainable development? Evidence rom a global perspective, Economic Analysis and Policy 75: 412-426.
DOI: https://doi.org/10.1016/j.eap.2022.06.002   Google Scholar

WEN H., LEE C. C., ZHOU F., 2021, Green credit policy, credit allocation efficiency and upgrade of energy-intensive enterprises, Energy Economics 94: 105099.
DOI: https://doi.org/10.1016/j.eneco.2021.105099   Google Scholar

WEN Q.X. et al., 2020, Research on the implementation of enterprise environmental protection credit evaluation policy, Chinese Journal of Environmental Management 12(04): 96-103.
  Google Scholar

WU J.M. et al., 2018, Research on government credit evaluation in the new era: a review and prospect from a new perspec-tive – based on Wu’s three-dimensional credit theory, Modern Management Science, 2018(04): 3-5.
  Google Scholar

WU S., ALHARTHI M., YIN W., ABBAS Q., SHAH A. N., UR RAHMAN S., KHAN J., 2021, The carbon-neutral energy consumption and emission volatility: The causality analysis of Asean region, Energies, 14(10): 2943.
DOI: https://doi.org/10.3390/en14102943   Google Scholar

XU X., LI J., 2020, Asymmetric impacts of the policy and development of green credit on the debt financing cost and maturity of different types of enterprises in China, Journal of Cleaner Production 264: 121574.
DOI: https://doi.org/10.1016/j.jclepro.2020.121574   Google Scholar

YANG H.S. et al., 2014, Policy instability and economic growth – empirical evidence from changes of local officials in China, Management World 2014(09): 13-28+187-188.
  Google Scholar

YANG K., LEE L. F., 2017, Identification and QML estimation of multivariate and simultaneous equations spatial auto-regressive models, Journal of Econometrics 196(1): 196-214.
DOI: https://doi.org/10.1016/j.jeconom.2016.04.019   Google Scholar

YIN J.H. et al., 2020, Policy Uncertainty and innovation of heavy polluting enterprises – evidence from key monitoring enterprises of wastewater state control, Journal of Beijing Institute of Technology (Social Sciences Edition), 22(05): 23-31.
  Google Scholar

ZHANG J., ALHARTHI M., ABBAS Q., LI W., MOHSIN M., JAMAL K., TAGHIZADEH-HESARY F., 2020, Reassessing the Environmental Kuznets Curve in relation to energy efficiency and economic growth, Sustainability 12(20): 8346.
DOI: https://doi.org/10.3390/su12208346   Google Scholar

ZHANG K. et al., 2016, Interaction between inter-regional environmental protection investment and endogenous strategy of pollution emissions, China Industrial Economics 2016(02): 68-82.
  Google Scholar

ZHANG M. et al., 2019, Using three-sided dynamic game model to study regional cooperative governance of haze pollu-tion in China from a government heterogeneity perspective, Science of the Total Environment 694(C): 133559.
DOI: https://doi.org/10.1016/j.scitotenv.2019.07.365   Google Scholar

ZHANG M., ZHANG X., SONG Y., ZHU J., 2022, Exploring the impact of green credit policies on corporate financing costs based on the data of Chinese A-share listed companies from 2008 to 2019, Journal of Cleaner Production: 134012.
DOI: https://doi.org/10.1016/j.jclepro.2022.134012   Google Scholar

ZHANG W.B. et al., 2010, The pattern and evolution of inter-provincial competition in China's environmental regulation intensity – analysis based on two-zone space Durbin fixed effects model, Management World 2010(12): 34-44.
  Google Scholar

ZHANG Z., JIN T., MENG X., 2020, From race-to-the-bottom to strategic imitation: how does political competition im-pact the environmental enforcement of local governments in China?, Environmental Science and Pollution Research 27(20): 25675-25688.
DOI: https://doi.org/10.1007/s11356-020-09003-9   Google Scholar

ZHAO B. et al., 2019, Government transformation, public service, and manufacturing transformation and upgrading, Forward Position or Economics 10(06): 123-133.
  Google Scholar

ZHOU J. Q., HAN, Z. Z., 2020, Environmental Regulation, Factor Market Reform Dividends and Green Competitiveness: Theory and Chinese Experience. Contemporary Finance & Economics (9)3.
  Google Scholar

Download


Published
2023-07-07

Cited by

Zhang, B. (2023). Supervised Credit, Government Strategies and Green Development: Evidence from China . Problemy Ekorozwoju, 18(2), 216–228. https://doi.org/10.35784/preko.4035

Authors

Bingbing Zhang 
zhang7662022@163.com
Agricultural Development Bank of China, Nan‘an Sub-Branch, 362300, Nan‘an, China China

Statistics

Abstract views: 172
PDF downloads: 185